Darling banking on 11th hour deal with US

Alistair Darling was last night involved in last minute negotiations with US
officials after revelations he will be unable to confirm a key concession on
non-domiciled tax changes in Wednesday’s Budget speech.

HM
Treasury is planning to scrap a rule which would have left tens of thousands
of US City workers facing double-taxation. But frantic negotiations and an
extraordinary visit to Washington by senior treasury officials failed to get an
official recognition the £30,000 levy on non-domiciled residents in the UK will
be permitted against their US tax bills, according to The Daily
Telegraph.

Although the US Internal Revenue Service has informally agreed that the levy
will not be subject to double taxation by US tax authorities, it is unlikely to
confirm this before later in March. This does not do much for the image of
Darling, who has already had to make a number key concessions on his tax plan.

‘This is 11th-hour stuff and not the way we should be introducing
legislation, involving our most significant trading partner – particularly in
the financial services. All of this should have been thought about in advance,’
Mike Warburton ofGrant Thornton,
said.